New commercial lending, including loans to property investors, has suffered its biggest fall in since February, latest figures show.

A 7.8 per cent decline in commercial lending in September – to $40 billion – has led the total of new lending commitments, including housing, personal, commercial and lease finance, to its largest decline in nine months.

Australia’s total new lending commitments fell by 5.3 per cent in September and are down by 1.6 per cent over the same period last year, data released on Monday by the Australian Bureau of Statistics showed.

CommSec senior economist Ryan Felsman said restrictions on placed on bank lending to investors by the Australian Prudential Regulation Authority appeared to be having an impact on property lending.

“It appears that tighter lending standards from the bank regulator are starting to bite in the home loan market,” Mr Felsman said.

Home loans to owner occupiers were down 2.1 per cent in seasonally adjusted terms to $20.7 billion, according to the ABS.

Personal loans rose 0.8 per cent to $6.24 billion in September, while lease finance fell 1.3 per cent to $565 million.

Of the total seasonally adjusted value of Australian commercial lending, the fixed loan component fell by 12.9 per cent, the lowest in three years.

Revolving credit loans, where a business pays an initial fee and then dips into operating funds as needed, fell by 10.9 per cent.

Mr Felsman said despite job security improving, consumers were still cautious and remain constrained by elevated household debt and slow wages growth.

“Personal finance commitments, however, are gradually rising again as Aussies feel more comfortable taking on loans, with interest rates likely to remain at record lows for the foreseeable future,” Mr Felsman said.


By Christian Edwards